The overall objective and viewpoint of the Law on Investment is to institutionalize the Party’s resolutions on perfecting the socialist-oriented market economy institution, developing the private economy and perfecting the political and economic institutions, improving the quality and efficiency of foreign investment cooperation until 2030. So about the matter “Law on investment with foreign elements in Vietnam” Let’s find out with LSX in the article below.
Legal grounds
- Investment Law 2020
Objectives, general view of the Investment Law 2020
The Law on Investment is very important in creating a unified, synchronous and complete legal basis to improve the effectiveness and efficiency of the management of investment activities and the use of public investment capital; overcome the scattered and scattered investment situation, contributing to improving investment efficiency in accordance with the objectives and orientations of the country’s socio-economic development strategies and plans; against loss and waste; ensuring publicity and transparency in investment management.
The objective and general view of this Law is to institutionalize the Party’s resolutions on perfecting the institution of a socialist-oriented market economy, developing the private economy, and perfecting institutions and policies. , improve the quality and efficiency of foreign investment cooperation by 2030.
The specific objectives of this Law include:
First to improve the quality and efficiency of attracting domestic and foreign investment resources in line with the planning and development orientations of sectors, fields and localities on the basis of ensuring security and national defense. , sustainable development and environmental protection.
Second, perfecting regulations on conditional business investment and business lines, and at the same time cutting down a number of unnecessary and unreasonable industries and trades in order to continue ensuring the implementation. fully and consistently the right to freedom of business of people and enterprises in industries and trades that are not prohibited or regulated by the Law.
Third, create more favorable conditions for investment registration activities; cutting costs and administrative procedures in investment and business activities. Completing the mechanism of decentralization of management between central and local agencies on the basis of ensuring the effectiveness and efficiency of state management over investment and business activities; expand and improve the autonomy of enterprises in business investment and management activities.
Requirements for the development of a Law on Investment with foreign elements
– Ensure the full and consistent implementation of the Investment Law’s reforms in association with the implementation of the Government’s resolutions on tasks and solutions to improve the business environment, enhance national competitiveness, support development and cut costs for businesses.
– Ensure consistency, transparency, feasibility and efficiency in the implementation of the provisions of the Investment Law and the laws related to investment and business, especially the laws on land and construction, housing, real estate business, environment, technology transfer…
– Ensure compliance with Vietnam’s integration commitments, including commitments related to market opening, liberalization and investment protection under bilateral investment agreements as well as trade agreements. New generation freedom.
Law on investment with foreign elements in Vietnam
Conditions for establishing economic organizations in Vietnam by foreign investors
According to the provisions of Article 22 of the Law on Investment 2020:
“first. Investors establish economic organizations in accordance with the following provisions:
a) Domestic investors establish economic organizations according to the provisions of the law on enterprises and the law corresponding to each type of economic organization;
b) Foreign investors establishing economic organizations must satisfy the conditions for market access for foreign investors specified in Article 9 of this Law;
c) Before establishing an economic organization, a foreign investor must have an investment project, carry out procedures for issuance and adjustment of the Investment Registration Certificate, except for the case of setting up a small and medium-sized enterprise. creative enterprises and innovative start-up investment funds in accordance with the law on supporting small and medium enterprises.
2. From the date of issuance of the Certificate of Business Registration or another document of equivalent legal validity, the economic organization established by the foreign investor is the investor implementing the investment project in accordance with the provisions of this Law. specified in the Investment Registration Certificate.”
Thus, foreign investors establishing economic organizations must satisfy the market access conditions for foreign investors specified in the List of industries and trades with restricted market access for investors. foreign:
– Rate of ownership of charter capital of foreign investors in economic organizations;
– Investment form;
– Scope of investment activities;
– Investor’s capacity; partners participating in investment activities;
– Other conditions as prescribed in laws, resolutions of the National Assembly, ordinances and resolutions of the National Assembly Standing Committee, decrees of the Government and international treaties to which the Socialist Republic of Vietnam is a member. member.
In addition, before establishing an economic organization, a foreign investor must have an investment project and carry out procedures for granting and adjusting the Investment Registration Certificate, except for the case of setting up a small and medium-sized enterprise. creative start-ups and innovative start-up investment funds in accordance with the law on supporting small and medium enterprises.
The ratio of holding charter capital of foreign investors in economic organizations conducting investment activities
According to the provisions of Article 23 of the Investment Law 2020:
Economic organizations must satisfy the conditions and carry out investment procedures as prescribed for foreign investors when investing to establish other economic organizations; make capital contribution, purchase shares, purchase capital contribution portion of other economic organizations; investment in the form of BCC contract if such economic organization falls into one of the following cases:
– There are foreign investors holding more than 50% of the charter capital or the majority of general partners are foreign individuals, for economic organizations that are partnerships (current regulations are from 51% of charter capital). rate or more);
– Having an economic organization specified at Point a of this Clause holding more than 50% of charter capital (current regulations are 51% or more of charter capital);
– There are foreign investors and economic organizations in which foreign investors hold more than 50% of the charter capital or the majority of general partners are foreign individuals, for economic organizations that are partnerships holding more than 50% of charter capital (current regulations are 51% or more of charter capital).
Conditions for foreign investors to contribute capital, purchase shares or purchase capital contributions of economic organizations in Vietnam
According to the provisions of Article 24 of the Investment Law 2020:
Foreign investors may contribute capital, purchase shares or purchase capital contributions from economic organizations when fully meeting the following regulations and conditions:
– Market access conditions for foreign investors are specified in Article 9 of the Investment Law 2020;
– Ensuring national defense and security according to the provisions of the Investment Law 2020;
– Regulations of land law on conditions for receiving land use rights, conditions for using land in islands, communes, wards, border towns, communes, wards and coastal townships.
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Frequently asked questions
Amending and supplementing Article 4 of the Investment Law to clearly define the scope of regulation as well as the principles of application of the Investment Law and related laws. Accordingly, in case there are different provisions between the Law on Investment and other laws promulgated before the effective date of the Law on Investment regarding the order and procedures for business investment and investment security, the following provisions shall apply. provisions of the Law on Investment, except for the following cases:
+ The investment, management and use of the State’s investment capital in enterprises shall comply with the provisions of the Law on Management and use of state capital invested in production and business in enterprises;
+ The authority, order and procedures for public investment and the management and use of public investment capital shall comply with the provisions of the Law on Public Investment;
…
The subject of regulation of investment law is business investment relations. The nature of investment relations is a type of social relationship, arising in the field of investment. Investment relations take place between entities in the process of mobilizing and using resources for production and business, meeting the needs of the economy as well as the whole society. These relationships, when regulated by law, become investment legal relations.
From the perspective of legal theory, investment legal relations are social relations arising between subjects in the process of carrying out investment activities and are governed by investment law. In the context of the market economy, investment relations are increasingly rich and diverse in content, form as well as subject composition.
The Law on Investment (amended) has 7 chapters, 77 articles and 4 appendices with regulations on business investment activities in Vietnam and business investment activities from Vietnam to abroad. The Law takes effect from January 1, 2021, except for the provisions in Clause 2 of this Article. The provisions of Clause 3, Article 75 of this Law take effect from September 1, 2020. Investment Law No. 67/2014/QH14 has been amended and supplemented with a number of articles according to Law No. 90/2015/QH13, Law No. 03/2016/QH14, Law No. 04/2017/QH14, Law No. 28/2018/QH14 and Law No. 42/2019/QH14 shall cease to be effective from the effective date of this Law, except for Article 75 of the Investment Law No. 67/2014/QH14.
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